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CITY OF SASKATOON
Saskatoon, also known as the “Hub City” refers to its favourable central location in the province of
Saskatchewan. The 2016 Statistics Canada Census reported a total of 295,095 people, including the
bedroom communities, making it Saskatchewan’s largest city. The City of Saskatoon website is reporting a
number of 265,300 residents in the City of Saskatoon alone in 2016. Saskatoon has a largely diversified
economy with a wide range of products and services in demand from around the world. With steadily
growing infrastructure, natural resources, research and development, and a well-educated workforce it is
seen as one Canada’s fastest growing cities according to Statistics Canada.
CITY MAP
Real Estate Market
Saskatoon experienced prominent real estate growth starting in 2007 and saw a growing population, which
expanded the suburban areas to include Stonebridge, Willows, University Heights, Rosewood, Blairmore,
Hampton Village, Evergreen and the extension of Parkridge. Additional suburban developments announced
in 2014 include Kensington and Elk Point in the Blairmore subdivision; and Brighton, the first development
in the Holmwood subdivision. One indicator of the prominent growth in Saskatoon is noted in the Multiple
Listing Service, which revealed a 66% increase in the average single-family dwelling sale price from
$233,399 in 2007 to $350,227 in 2016. The year 2016 saw a decrease in housing sale prices of $3,820 from
$354,047 in 2015. The first portion of 2017 has seen a further decline with a drop from 2016 with an
average sale price of $337,980. There were 3,719 single-detached dwelling and multifamily unit sales in
2016 compared to 3,959 resale transactions in 2015. The slight decrease of sales in 2016 was said to be
attributed to stabilized net migration and a slower economic climate. Low mortgage rates and stabilization
in housing prices forecast a buyer’s market into 2017. The drop in oil prices and high costs of construction
are contributing factors to the stabilization of the market in 2015 and into 2016. Saskatoon reached
$725,521,000 in building permits in 2016, a significant decrease from the previous record of $1,088,500,000
set in 2013 according to the City of Saskatoon Building Standards Branch. Although the residential permit
value decreased widely, the majority of the permit value can be attributed to institutional and industrial
projects.
In March 2012, City council outlined the Strategic Plan 2012-2022 and the Integrated Growth Plan for the
re-orientation of transportation planning, community planning, and building processes in Saskatoon. The
City, in conjunction with private developers, initiated the process of developing low-income housing
projects in various parts of the city to alleviate the shortage of rental accommodation created by a growing
population. The trend to re-invest and refurbish older rental properties coupled with an increase in new
condominium and rental designed developments in the past few years have contributed to a rising supply
and a steady increase in Saskatoon’s vacancy rates. Saskatoon saw the highest vacancy rate on record in
2016 at 10.7%. This decline in rental demand can be attributed to economic factors and rising
unemployment.
The annual business profile report indicates that 1,243 new business licenses were issued in 2015. A total of
10,659 licenses were issued with 6,176 representing commercial/industrial businesses. The report for 2015
indicated there was a 2% increase in the number of licensed business over the previous year.
Commercial/Industrial businesses continue to make up 58% of all businesses and home-based businesses
make up 42%1.
Resource Markets
Saskatchewan is still largely dependent on agriculture, which has shown strong growth in recent years in
response to global economics and healthy commodity prices in the agricultural sector. However,
agriculture is not the only thing providing prosperity to the province. Saskatoon is an ideal central location
for distribution and logistics and is associated with various grains, livestock, oil and gas, potash, uranium,
gold, diamonds, coal and their spin off industries. Saskatoon’s location provides a gateway for these
industries for several reasons. Employees are able to travel by air to northern mines, and goods can be
transported to northern mines through a diverse road network. Saskatoon is also a central location in
Western Canada for access to west coast ocean ports serving international markets.
Saskatoon houses the international head offices for the world’s largest publicly traded uranium company,
Cameco, and the world’s largest potash producer, Potash Corporation. Areva Resources Canada Inc. is also
headquartered in Saskatoon. BHP Billiton, the world’s largest vertically integrated mining company,
relocated its Canadian head office to Saskatoon from Vancouver in 2011. The move reflects well on
Saskatoon, which could be the primary business centre for mining and related businesses. The Jansen mine
project, which has the potential to become the world’s largest potash mine, provides another beneficial
boost to the city.
Potash prices saw a slight increase in 2014, declined slightly in 2015 and hit a decade low in 2016. Prices
tapered off significantly in 2016 but are forecasted to recover in 2017 as potash prices rebound. Slowing
demand and large supply is believed to be the cause of the decline. In April 2015, Potash Corp. cut its full
year earning potential because of higher taxes and reduced income from foreign investments. Potash Corp.
1 https://www.saskatoon.ca/sites/default/files/documents/community-services/planning-development/business-license-mapping-research/business-license/business-profiles/business_profile_annual_report_2015.pdf
announced temporary shutdowns for its Cory, Allan and Lanigan facilities to begin in early 2017 and will
result in 140 layoffs. This follows the indefinite shut down of its New Brunswick mine to save costs from
slumping prices in 2016. A proposed merger with Agrium Inc. is anticipated to occur in 2017 which will
reduce costs for both companies and target the farming sector for retail fertilizer.
Cameco announced 500 layoffs and suspension of its Rabbit lake mine in April 2016 due to an oversupply of
uranium around the world.
Industrial Market
The Saskatoon industrial sector maintained its growth throughout 2016, with approximately 390,000 square
feet of new industrial space completed in 2016 and 280,000 square feet currently under construction in the
early portion of 2017, according to Colliers McClocklin. Of the 280,000 sf under construction, Colliers
reports two-thirds are owner-users. The industrial market is experiencing a continued rise in vacancy rates
and a drop in asking rental rates. The market has the largest supply of industrial space over the last 4 years
creating a tenant-friendly market with increased inventory, lowering rates and attractive incentives.
The City of Saskatoon’s Industrial Land Incentive Program of 2011 has continued to be successful with its
aim to attract new industries to the Saskatoon marketplace and to provide additional opportunities for
existing industries to expand their operations. It appears however land supply has caught up with demand
as some tendered lots at the beginning of 2014 sit available at the end of 2016. Part A of Phase 10 of the
Marquis Industrial began in 2016 and is expected to release approximately 40 acres of serviced industrial
land. Developers continue to appear more cautious into 2017 with nearly 2,000,000 square feet of
industrial space reported vacant at the end of 2016 as supply outweighs demand following a number of
years of heavy construction.
The trend of industrial developments continues toward industrial condominiums with sale prices stabilized
from 2015. This is due to the financial accessibility of small scale industrial units to smaller owner-
occupants. More typical single and multi-tenant office warehouse projects have also continued within the
industrial sector. Both Colliers McClocklin and ICR expect vacancy rates to stabilize into 2017.
Industrial land prices in 2016 averaged $450,000 per acre throughout the City of Saskatoon. The average
asking prices in the Marquis North Industrial remain around $530,000 per acre.
Office Market
The downtown office market has reached a transitional phase after several years of large-scale expansion
with notable developments and record low vacancy rates. The city is now amidst a surplus of inventory and
higher vacancy rates due to several major office developments being completed in the downtown area over
the last six years totaling over 400,000 square feet coupled with the relocation of the City Police leaving the
downtown space vacant has added to the CBD office inventory. These major projects may have temporarily
met the need of the expanding downtown office market as there is a noticeable softening in the market.
Competition with the suburban market may be an issue for the CBD office market attributable to
differences in parking costs and availability, according to Colliers. ICR Commercial stated there will be a
limited amount of construction over the short-term with no real major construction occurring at this time.
There are, however, various proposed projects in the downtown and suburban areas including a LEEDS
Class A 75,000 square feet office tower on the corner of 20th Street East and 4th Avenue South. Saskatoon
City council approved the lift of a height restriction in the future development for the North Prairie City
Centre towers consisting of two office/retail/residential mixed use buildings reaching 30 stories on the
corners of 22nd Street East and 3rd Avenue South and 22nd Street East and 4th Avenue South.
Major issues impacting the downtown office market is the rising availability of sublease space which has
continued throughout 2016 resulting in negative net absorption rates. In addition to the 378,238 square
feet of direct vacant space, Colliers is reporting an additional 15,791 square feet of sublease space available
in the CBD and 44,100 square feet of negative net absorption, slightly better than 2015. Forecasts for the
beginning of 2017 are predicting a modest recovery showing the negative net absorption and vacancy rates
to stabilize.
Construction in the Suburban market has persisted through 2015 and 2016 with approximately 170,000
square feet of proposed construction in the Cornerstone Commons of Stonebridge, in four phases. As with
the Downtown office market, the suburban office market has also seen a hike in vacancy rates and is
expected to remain steady into 2017. Additional suburban development in the Holmwood area shows
plans for a business park similar to Stonebridge.
Retail Market
Although 2015 saw a slight increase in vacancy, most accounts for the former Target locations. Net rental
rates have remained stable throughout 2016. The River Landing project is still progressing with the Farmer’s
Market continuing to draw people to the area of Riversdale. A 15-storey, 155-room hotel and 27-storey
condo development for the River Landing; Parcel Y began construction in 2016, with expectation to
complete in 2018. Both buildings are expected to house commercial and office space as well. The
development of the new Remai Art Gallery is designed to be a 124,700 square foot, four-storey gallery. It
began construction in 2013 and is expected to open in 2017.
The Banks development broke ground in 2014. This development includes four buildings made up of
commercial and residential space. Plans to revitalize the Riversdale Business area as part of the River
Landing Phase II include the Streetscape Improvement Project has attracted a number of new businesses as
well as existing businesses including Bike Universe, Doug’s Spoke & Sport, and Brunsdon Lawrek and
Associates, which have moved to 20th Street West. In recent years, a number of new businesses have
opened including Collective Coffee, Thrive, Anthology, Green Ark, The Grazing Goat, Odd Couple and a
number of other restaurants.
Downtown continues to be the most desirable location for retail. Saskatoon saw a number of restaurants
open in the downtown area in recent years including Cactus Club Café, Fion MacCool’s, Bon Temps, Cut
Steakhouse and The Crazy Cactus. The year 2016 saw Tim Hortons, Crepe Delicious, Bath & Body Works and
Tommy Gun’s opened in the Midtown Plaza, downtown Saskatoon.
The new Blairmore Shopping Centre continued to expand throughout 2015 with the opening of Staples and
the 130,000 square foot Lowe’s facility. The City has sold the balance of the commercial land in the area.
The Blairmore centre now serves a number of communities surrounding it with expectations of a new 40
acre power centre development west of the current Smart Centre becoming available later in the near
future. The south end of the Kensington neighbourhood is also the location of a number of commercial
enterprises including a 33,000 sf grocery store slated to open in early 2017.
Stonebridge continues its high level of development with the 143,000 square foot retail development at the
corner of Preston Avenue and Circle Drive now completed. The 78,000 square foot Sobey’s opened in fall
2014 with grocery and liquor stores along with a 17,000 square foot Shopper’s Drug Mart and Canadian
Brewhouse. Additionally the 50,000 square foot Ironwood retail/office development on the southeast
corner of Preston and Cornish Road is mostly leased.
Phase 5 of the retail development in the Preston Crossing area has begun, west of Old Navy. This will add
109,000 square feet on 8.8 acres to the existing 600,000 square feet of retail space in the area, according to
Colliers. New subdivisions, Rosewood and Holmwood are also marketing retail space. Rosewood has
amended the concept plans to include 90 acres of retail zoned land and 2016 saw the opening of a second
Costco within the Meadows development of Rosewood. Holmwood is proposing a 240,000 square foot
retail site and 900,000 square feet of retail space across McOrmond Drive.
University of Saskatchewan
Innovation Place was founded in 1980 and now has almost 130 agriculture, information technology,
environmental, life sciences, medical, and biotechnology industries. The combined firms employ more than
3,300 people in 19 buildings in a park setting. The Canadian Light Source synchrotron became operational
in 2004, bringing a number of high paying research jobs to Saskatoon and encouraged companies to
establish research facilities here. The International Vaccine Centre (InterVac) was occupied in early 2008
which added 160,000 square feet to the VIDO building. The University received $33.1 million dollars in
federal funding in 2016 to complete the Collaborative Science Research Building and other infrastructure
improvements.
The largest employer in Saskatoon is the University of Saskatchewan in conjunction with Innovation Place
and has a student body of over 21,000 students. The University has undergone numerous developments in
the last 3 years. Place Riel, the campus’ front door, recently completed an expansion of 78,437 square feet.
The campus student resident expansion project created 800 student beds in four five-storey buildings
completed in September 2012 and one more residence opened in January 2013 providing over 200 beds for
graduate students. The campus student residences house an estimated 12% of the student population, up
from 6% prior to the expansion. In 2013, the university negotiated a long-term land lease agreement which
has resulted in the first stages of construction on a 203-room, 10-storey hotel development near Griffiths
Stadium. The development’s operations will be split into a Holiday Inn Express wing and a Staybridge Suites
wing to be completed in 2018.
With the slump in oil prices over the last year, an impact was felt in the fiscal budget of the Saskatchewan
Government. Budget cuts in the first half of 2015 were seen in the education and hospital groups. The
Saskatchewan Government has unveiled plans to amalgamate the province’s 12 health regions into one
health authority by the fall of 2017. P3 partnerships have gained in popularity in the region to keep the
momentum of developing infrastructure. In Saskatoon, the construction of a North bridge is underway with
the support of the P3 partnership program as well as nine new schools in the province, of which four are
located in the City of Saskatoon.
In summary, the wide diversification of regional resources in mining, manufacturing, and research areas,
has led Saskatoon to be the third-fastest growing city in Canada. More detail on the city and the individual
real estate markets can be gained from visiting our web page at ‘www.brunsdonlawrek.com’ or by
contacting our company directly for copies of our market overviews or real estate studies.
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